FHA, Conventional and USDA Home Loans Across Oregon: Credit, PMI and Appraisal Rules — Basalt & Byline
Updated October 2026
A buyer comparing a Salem bungalow with a rural Polk County home may qualify for different mortgage programs even at the same purchase price. In Oregon, the useful comparison starts with property eligibility, available cash and the full monthly payment, rather than the advertised interest rate alone.
Compare credit, down payment and insurance
| Feature | Conventional | FHA | USDA guaranteed |
|---|---|---|---|
| Key eligibility | Credit and qualifying income | Credit and qualifying income | Eligible location and household income |
| Minimum down payment | As low as 3% for eligible borrowers | 3.5% with qualifying credit | Zero down for eligible borrowers |
| Mortgage insurance | Usually required below 20% down | Upfront and annual premiums | Upfront guarantee fee and annual fee |
FHA permits 3.5% down with scores of at least 580, while scores from 500 through 579 generally require 10%; lender requirements can be stricter. Conventional credit eligibility depends on the underwriting method and lender. USDA does not impose one universal minimum credit score for every guaranteed loan, although lenders commonly establish their own thresholds.
Conventional PMI can be canceled under applicable rules. FHA annual mortgage insurance generally lasts 11 years with an initial down payment of at least 10%, or the loan term with less down. USDA annual fees follow their own schedule.
Oregon limits and assistance change the comparison
The 2026 baseline conforming limit for a one-unit property is $832,750 across Oregon. The FHA floor is $541,287, with higher limits in the Portland-Vancouver-Hillsboro and Bend-Redmond metros. Check the county and unit count through HUD FHA Mortgage Limits and FHFA Loan Limits.
Oregon Housing and Community Services offers Flex Lending FirstHome and NextStep, including 4% or 5% assistance with forgivable or repayable structures. Its Oregon Bond Residential Loan Program offers Cash Advantage and Rate Advantage. Eligibility, assistance repayment and permitted loan combinations deserve a side-by-side review.
Appraisal approval is separate from borrower approval
All three programs require acceptable collateral. FHA and USDA place particular emphasis on safety, soundness and sanitation; conventional appraisals can also require repairs. An appraisal is not a substitute for an independent inspection.
Run taxes, insurance and mortgage insurance through the monthly payment calculator. For acreage or an outlying address, use the Oregon USDA guide before assuming the location qualifies.
Editorial Methodology & Primary Sources
Verification date: Not recorded; check the primary source and lender timestamp before relying on an estimate.
Rate comparisons use participating lender feeds, not a whole-market survey or guaranteed offers. Freddie Mac PMMS is a market benchmark, not a personalized quote. Calculator models rely on published regulatory formulas and disclosed assumptions rather than fabricated first-person loan testing.
Monthly principal and interest use the amortization formula P × r / (1 − (1 + r)−n), where r is the monthly note rate and n is the number of payments; at zero interest use P / n. PITI adds monthly property taxes and homeowners insurance; PMI is separate. APR includes applicable finance charges under Regulation Z and is not the note rate used for payments. Compare lender Loan Estimates for actual APR and fees.
- Consumer Financial Protection Bureau (CFPB) — Loan Estimates, APR and borrower disclosures; Regulation Z.
- U.S. Department of Housing and Urban Development (HUD / FHA) — FHA program guidance.
- U.S. Department of Veterans Affairs (VA) — VA loan eligibility and benefits.
- Freddie Mac Primary Mortgage Market Survey (PMMS) — published rate benchmarks.
- U.S. Census state tax collections — state property tax benchmarks; confirm parcel-specific assessments and exemptions with the state revenue department and local assessor.
- Oregon Housing and Community Services — state housing finance and property tax authority.
- Oregon Department of Revenue — state housing finance and property tax authority.
The payment snapshot uses illustrative annual taxes of 1% of home price, $1,200 insurance and 0.5% PMI below 20% down, not verified local quotes. Other calculators disclose their inputs and assumptions. Published guidance and lender feeds may change independently; confirm current program rules, taxes and offers before a decision.